The fiscal 1997 agriculture appropriations bill seems headed
to a major confrontation pitting farmers and environmentalists against
agribusiness. At stake is the 36.4 million acre Conservation Reserve Program in
which farmers are paid about 1.8 billion dollars a year to not use
"environmentally sensitive" land.

During fiscal 1996, congress restricted the Agriculture Department from adding
any new land into the program in a cost cutting manuever. But with the signing
of the Farm Bill on April 4 of this year, a provision was added by agriculture
committee members, which allowed conservation signups to continue and payments
mandatory.

Now the Coalition for a Competitive Food and Agricultural System have been
lobbying to limit the sign-ups again. The grain traders and other
agribusinesses which make up the CCFAS want Congress to bar the Agriculture
Department from spending any money to administer sign-ups in fiscal 1997.

The coalition believes that 1 to 2 million acres could be taken out of the
conservation program in fiscal 1997, and 12 million more the following year.
They believe the land could be put back into production , possibly to increase
the nation's low grain stocks, with little or no environmental damage.

Immigration Reform

Two House committees held hearings in December 1995 to review
the need for a new agricultural guest worker program. The new program would
replace the current H2-A seasonal farmworker program. Growers have generally
called the current program ineffectual.

The Immigration Subcommitee and the House Agricultural Committee heard
testimony requesting that congress include an amendment to H.R. 2202, proposed
legislation designed to curb illegal immigration, to authorize a new program.
Agricultural groups argue that H.R. 2202 as written could have the effect of
decreasing the current agricultural labor supply.

House Defeats "Guest Worker" Program

By a vote of 242 to 180, the House of Representatives decisively rejected Congressman
Richard Pombo's (R-Stockton) "Temporary Agriculture Worker Program", that would have
insured growers an adequate work force once tough immigration laws go into effect. The
Pombo amendment was attached to the Immigration Reform bill which the House passed.

The Pombo amendment would have modified the current temporary agricultural worker program by
creating a three-year alternative pilot program which would have allowed employers to hire
temporary and seasonal workers for less than 10 months at a time. The amendment included a
mandate that American workers would have been given preference during the first 25 days of
hiring, and that 25% of a worker's wages would be withheld until the worker leaves the country.

With exclusion from the House Bill, the "Temporary Agricultural Worker Program will find
Passage in the Senate much more difficult. President Clinton has threatened a veto if the
"guest worker" program is included in the immigration reform legislation.

1995 Farm Bill

The House and Senate have established a budget reduction goal of $13.4 billion from farm
programs. The Administration has said it wants $5 billion cut from farm programs.
Three particular areas of concern in the 1995 Farm Bill are:

Planting Flexlibility:
Current law prohibits subsidized producers from planting program crop acres
(feed grains, food grains, cotton, etc.) with fruits and vegetables. Without
this restriction, farmers could receive payments for those acres and grow
produce on them in direct competition with production from unsubsidized acreage.

Vitamin and Mineral Supplements:
UFFVA is opposed to H.R. 236 and to S. 1133, which would allow food stamp recipients to
buy vitamin and mineral pills with food stamps. These bills could become part of the
Farm Bill. We believe this encourages the substitution of pills for produce, and
confuses nutrition education efforts.

Senate Approves Landmark Farm Bill

The Senate voted Wednesday February 6th, 1996 to change 60 years of farm policy, pruning
crop subsidies in enchange for giving farmers new planting freedoms and seven years of
guaranteed checks.

The "Freedom to Farm" bill, passed on a 64-32 vote. The year long Senate fight over the 1995
Farm Bill now moves to the House of Representatives, which will not meet until February 26.

The bill passed by the Senate rewrites the traditional bargin that the farmers have had with
the federal government since the 1930s. It required that farmers restrict how much they grow
in exchange for subsidies when crop prices were low.

The Senate's new bill erases that formula. Farmers with a history of growing wheat, corn, feeds
grains, rice or cotton would be guaranteed $40,000 a person but will be declining each of the
next seven years. It doesn't matter if crop prices go up or down, nor how much they grow. Even
if farmers let crop land lay idle, the checks will arrive.

Agriculture Secretary Dan Glickman said the Senate passage of the bill was "a step in the
right direction." But, he said,"I remain concerned that the bill will provide payments when
market conditions are good, and that it does not provide as strong a safety net for family
farmers as we would like."

Congress Passes Landmark Farm Bill

Congress gave final approval today March 29th, 1996 to the
Farm Bill. The House passed it 318-89 early today in a post-midnight session.
Speaker Newt Gingrich called it "the largest reform in the system in 60 years."

The bill went to the White House, and President Clinton is expected to
reluctantly sign the bill.

The legislation covers a wide range of issues, including environmental,
nutrition and specific crop and rural development. The bill will end federal
subsidies based on prices, and instead offers guaranteed but gradually
declining payments. The bill also ends the government's control over what
farmers can and cannot plant and on what fields they can cultivate.

Republicans generally feel that the new bill will allow farmers to make more
money and generate dynamic econmic renewal in rural America.

President Clinton Signs Historic Farm Bill

Under the watchful eyes of Agriculture Secretary Dan Glickman, President Clinton on Thursday
April 4, 1996 reluctantly signed into law historic farm legislation that breaks the link
between crop prices and government subsidies.

While the law stops many government controls on farmers, President Clinton said
it "fails to provide an adequate safety net for family farmers."

The law ends government-guaranteed prices for corn, other feed grains, cotton, rice
and wheat. Farmers will now receive payments that decline over seven
years and an immediate end to most planting controls. The payments total $36
billion over seven years and account for most of the funds in the $47 billion law.

The Administration had opposed the bill because it gives farmers windfall payments during
times of high market prices, during which normally the subsidies would have been much less.
The reverse side is that when the guaranteed payments end, farmers will have little protection
during market collapses.

President Clinton has stated that he would propose legislation next year to restore some
of the safety net for farmers. At any rate, Congress will have a chance to change the law when it ends in seven years.

The President quietly signed the bill without using his power of veto once the bill included
money for conservation and environmental protection. Also included is a guarantee that food stamps and
other nutrition programs will continue and that monies had been allocated for rural development and
research. The administration also supported the provisions giving farms and growers more flexibility to plant what they want.

The law also ends the special tax on dairy producers and phases out the government support for
butter, powdered milk and cheese over four years. The department is required by the new law to
merge 33 regional diary price-setting agreements into between 10 and 14.

Governor Wilson Signs Legislation

Governor Wilson on March 12, 1996 signed into legislation
SB1XXX which extends the study deadline for Methyl Bromide.

Methyl Bromide is widely used in California to fumigate farmland before
planting. It is also used as a post-harvest and storage fumigant.

The bill passed by the Senate rewrites the traditional bargin that the farmers
have had with the federal government since the 1930s. It required that farmers
restrict how much they grow in exchange for subsidies when crop prices were
low.

Because Methyl Bromide depletes the ozone layer, the U.S. Clean air Act
requires that use of the pesicide end by 2001.

Senator Henry Mello's SB1XXX passed the Senate on February 22, 1996

The Assembly passed SB1XXX on March 7, 1996

Governor Wilson signs the legislation and the law goes into effect on the 91st
day after adjournment of the special session.

Methyl Bromide Bill Sent To Governor

The Assembly sent to the governor Thursday March 7th, a bill
extending until Dec. 31, 1997, a March 30 deadline for the use of the fumigant
methyl bromide. Governor Pete Wilson said he would sign the bill.

Methyl bromide is pumped into the ground before more than 60 crops are planted
to rid the soil of worms that destroy roots. It is also used to fumigate
shipping warehouses to prevent pests from traveling in or out of the state.

Senate Extends Methyl Bromide Deadline

The state Senate voted Thursday February 22, 1996 to let
California's farmers keep using Methyl Bromide. On Wednesday, Feburary 28, SB
1XXX was heard in the Assembly Agriculture Committee, where it passed 11 to 3.
It will be heard in the Assembly Appropriations Committee on March 4, and from
there it could be heard on either March 7 or 11. Once passed, the Assembly
without amendment, it would go directly to the Governor.

The Senate voted 22-11 to approve SB 1XXX, a bill sponsored by Senator Henry
Mello D-Santa Cruz, to allow farmers to use Methyl Bromide as long as a
required health study is done by December 31, 1997. If the deadline had not
been extended, growers would have had to stop applying the chemical.

The Assembly last month voted 45-28 for a bill with the December 31, 1997
deadline for the final health study. The differences between the Assembly and
Senate versions will now be worked out before a final bill goes to Govenor
Wilson.

Methyl Bromide is widely used in California to fumigate farmland before
planting. It also is applied on crops destined for export. It is relied upon by
strawberry growers to apply it each fall to sterilize the soil before they sow
new plants.

Because Methyl Bromide depletes the ozone layer, the U.S. Clean air Act
requires that use of the pesicide end by 2001.

Methyl Bromide

Farm groups in California are asking Gov. Wilson to call a special legislative
session to prevent a threatened ban on the fumigant Methyl
Bromide next year.

The EPA plans to ban Methyl Bromide at the start of the next century because
the pesticide damages the ozone layer. The Birth Defect Act of 1984 requires
that manufacturers of 200 named chemicals submit studies on health effects to
the California Department of Pesticide Regulation.

The company that makes Methyl Bromide, Great Lakes, says it can't meet the deadline,
which was extended four years ago and now is set for March 1996. Jim Wells, director
of the state pesticide agency, admits the delay is partly because state and federal
officials couldn't agree on technical aspects of the study until last January, 1995.

SB808 by state Sen. Dick Monteith, R-Modesto, would extend the deadline again, but the
bill failed to get out of the health committee before the 1995 session ended.

Unless the bill takes effect immediately after passage, manufacturers or distributors
couldn't sell any new supplies in California. Farmers could continue using Methyl Bromide
already on hand or available in stores.

Methyl Bromide sanitizes soil by killing root-damaging nematodes before such annual
crops as strawberries are planted or when orchard and vineyards are replanted.

Primus Group, Inc. is a privately held investor-owned California corporation providing microbiological and pesticide residue analysis of food, database management services, and management of third party auditing schemes.